Wage deal set to bring stability to metals sector
It is the first time in 10 years parties have reached a settlement without resorting to industrial action, Seifsa CEO Kaizer Nyatsumba says
SA’s metals and engineering sector signed a 2017-20 wage agreement on Wednesday, after four months of tense negotiations at the Metals and Engineering Industries Bargaining Council (MEIBC), in Johannesburg.
Wages in the sector will rise 7% from July 1 2017; 6.75% from July 2018 and 6.5% in the third year. The main union in the agreement, the National Union of Metalworkers of SA (Numsa), had initially demanded a 15% increase across the board.
Major parties had decided to "compromise" to save collective bargaining in the industry. In June, the labour court had placed the MEIBC under administration in a bid to save it from bankruptcy. About 340,000 employees and 10,000 companies fall under the bargaining council.
"The process was long and hard, and there were considerable challenges along the way, but we are hugely relieved that finally, we and our labour partners were able to reach an historic agreement on realistic wage adjustments for the next three years," Kaizer Nyatsumba, CEO of major employer body the Steel and Engineering Industries Federation of Southern Africa (Seifsa), said.
The agreement was historic because this was the first time in a decade that parties had reached settlement without resorting to industrial action. Nyatsumba said the wage deal would bring much-needed stability in the sector, which had bled 25,000 jobs since 2014.
He said Seifsa and organised labour were both aware of the "enormous damage wreaked on the sector by cheap, often subsidised imports from China and other Asian countries".
Numsa general secretary Irvin Jim said the union was "proud its militant approach to wage talks had borne fruit". "We stopped employers from implementing the fake national minimum wage of R20 per hour and we also prevented them from downgrading varying basic conditions and eroding our hard won benefits," he said.
Employer associations had initially proposed that the R20 an hour national minimum wage be paid to new, unskilled employees in the sector.
Jim said the union was "mindful" of the damaging effects of a strike and the burden it placed on members. "We are also aware of the dismal economic situation caused by the downgrade to junk status and the negative impact that this has had on the growth of the metals and engineering sectors," he said.
Nysatsumba said that parties had come into negotiations from "vastly different starting positions". "However, to the credit of the respective parties, we moved gradually over time to the realistic figures at which we eventually settled."
Nonsignatories to the agreement included the National Employers’ Association of SA (Neasa). For years, the body had opposed collective bargaining agreements from being extended by what it said were larger companies in the steel and engineering sector to smaller firms, through Labour Minister Mildred Oliphant, in court.
Neasa said that smaller firms could not afford these increases, even though they were represented on the MEIBC.
Marius Croucamp, deputy general secretary of trade union Solidarity said the agreement had created hope, security and certainty for employees in the industry. "The industry is currently under immense pressure, and the demand for steel products is declining," he said.
Other trade unions that signed were the United Association of SA, Metal and Electrical Workers Union of SA and the South African Equity Workers Association.